ARCHIVED - Order CRTC 2000-616
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Order CRTC 2000-616 |
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| Ottawa, 30 June 2000 | |
Megastream rate revisions for Bell Canada and Télébec ltée customers |
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| Reference: Bell Canada Tariff Notice 719 and Télébec ltée Tariff Notice 242 | |
| The Commission approves, with conditions, Bell Canada's proposed tariff revisions under Tariff Notice (TN) 719 to increase the rates for selected Megastream components and change the service charges associated with circuit terminations. The Commission also approves, with the same conditions, Télébec ltée TN 242. | |
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1. |
The applications are approved subject to the condition that Bell Canada and Télébec ltée issue tariff pages within 10 days of the date of this order, to allow existing customers to migrate to alternate service providers without penalty, or to services provided by Bell Canada or Télébec with service charges waived. The migration window is for a period of six months from the date the tariff pages are issued, to allow customers to plan and implement their network. |
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2. |
The Commission received comments on Bell Canada's application from Primus Telecommunications Canada Inc. (Primus Canada) and Call-Net Enterprises Inc. Both intervenors requested that Bell Canada's application be denied. |
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3. |
Call-Net submitted that Bell Canada has not justified the proposed rate increases for Megastream. Call-Net provided a sales bulletin from Bell Canada indicating price increases of 24 to 33 percent for Megastream. Call-Net maintains the purpose of the rate increase was to improve the profitability of the service. It also submitted that while Megastream service is subject to limited competitive supply, the competitive alternatives are not ubiquitous. According to Call-Net, the fact that Bell Canada can contemplate a significant price increase is proof of its market power. |
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4. |
Call-Net also indicated that Megastream service is required by alternate service providers and end customers. An alternate service provider has to recover the Megastream rates when it is used as part of its service, while Bell Canada just has to recover its costs. Call-Net argued that as a result, competitors are unable to compete effectively with Bell Canada and that the rate increases will aggravate the situation. |
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5. |
Primus Canada submitted that the proposed rate increases are for services on non-forborne routes in many cases. Primus Canada also submitted that notwithstanding its arguments, it would not object to Bell Canada refiling TN 719 with a proposal to waive the service charges associated with migrating to an essentially substitute service. Primus Canada cited, for example, TN 5834 where Bell Canada waived service charges for migration. |
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6. |
Bell Canada, in reply, stated that the rate increases are designed to improve the profitability of the service. Megastream equipment, according to Bell Canada, is in the last phase of its service life cycle and because of migration to other services such as asynchronous transfer mode, manufacturers do not develop additional capabilities for Megastream equipment. Bell Canada stated that Primus Canada's proposal for a service charge waiver would eliminate the increase in profitability sought by the rate increases. |
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7. |
Bell Canada also submitted that the rate increase is less than 5 percent in billing for Megaplan service and there are alternate suppliers such as resellers and other facilities-based providers. It stated that Primus Canada could subscribe to Bell Canada's Megaroute service and purchase, install and manage Primus Canada's own equipment. |
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8. |
The Commission notes that Megastream is an uncapped service under the price cap regime and the tariffs for which Bell Canada is seeking rate increases are for services in non-forborne routes, where competition is limited. |
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9. |
Megastream customers include both alternate service providers and regular customers. In the Commission's view, allowing the rate increases for Megastream, without reasonable recourse for customers, could reduce competition. The Commission also notes that normally, rate stability is expected when customers sign long-term contracts. |
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10. |
Accordingly, the Commission considers that allowing the rates for the uncapped service to increase would be appropriate as long as customers can migrate to any other Bell Canada service to meet their requirements without service charges, or to alternate providers' services without migration penalties. |
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11. |
The Commission also considers appropriate that the conditions approved for Bell Canada TN 719 should apply to Télébec TN 242. |
| Secretary General | |
| This document is available in alternate format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca. |
Date Modified: 2000-06-30
- Date modified: